"Arkansas Works" backers could use new legislation to safeguard Medicaid expansion from legal challenge over line-item veto

DISMANG: Would like to see additional legislation to guard against possible line-item-veto lawsuit.

Backers of “Arkansas Works,” the governor’s plan to continue the Medicaid expansion private option, have additional options to guard against a potential legal challenge to the procedural maneuver they used to fund it. Lawmakers could potentially pass a new piece of legislation that even more firmly settles the matter of the continuation of Medicaid expansion. Senate President Jonathan Dismang today suggested that the governor include the issue on the call for an upcoming special session so that lawmakers could pass this safeguard bill (details on how all of this would work below).

If you’ve been reading this blog, you know the weird trick that “Arkansas Works” proponents used: they allowed the appropriation to go through with an amendment that ostensibly ended the program. However, the governor pledged to use his line item veto power to nix that amendment, allowing the private option to continue. Hutchinson has now done just that.

Some have raised legal concerns about whether the governor can use a line-item veto to scratch only a line of restrictive language — a past attorney general's opinion suggested that the governor can't veto language in an appropriation that "imposes a condition, limitation, restriction," without vetoing the entire appropriation. Democrats pushed an effort to revise the amendment so that it was not restrictive language — it doesn't restrict funding, instead merely saying that the program will end. They also added a severability clause in case the amendment itself was found unconstitutional (there is a whole other can of worms over whether this sort of substantive language should be allowed to be tacked on via the Special Language process during a fiscal session, a common practice leading to all sorts of shenanigans).

Despite the cleaner revision of the amendment language and the addition of the severability clause, someone might still try a lawsuit. Most legal experts I've talked to believe that such a challenge would fail and the Medicaid expansion would live on. But you never know!

Here we come to another safeguard, one that would seem to fully protect the Medicaid expansion from this sort of lawsuit. Via a simple majority, the legislature could pass legislation superseding the dummy amendment attached to the appropriation, rendering it moot even if there was a lawsuit over the governor's line-item veto. The new legislation would simply give a new sunset date to "Arkansas Works": Dec. 31, 2021, when the federal waiver would be set to expire anyways.

This could be done if the governor called a special session and put it on the call. The governor could do so specifically for this purpose. Or he could add it to the call of another special session, such as the one coming up for highway funding, which was Dismang's suggestion. Dismang, noting that some "Arkansas Works" opponents have already threatened a lawsuit, said that proponents of the policy want to do whatever they can to insure that there their intention stands and that a lawsuit doesn't muck up the works. He said he had begun conversations with the governor on the matter. Lawmakers who support this additional safeguard would like to see it done before the end of this fiscal year.

Asked about safeguard legislation of this kind today, Hutchinson said that his use of the line-item veto itself would hold up to any legal challenge: "I think we're in a strong position and on solid foundation." The governor declined to comment on whether he would put the issue on the call for a special session. "We're where we should be right now," he said. "If the legislative leadership wants to bring something else to me, I'll be happy to discuss it with them."

He added: "Sen. Dismang has raised that possibility with me. That's a legislative call. It's sort of like double-tying your shoelaces. If they want to double-tie the shoelaces, I'll be glad to have that conversation with them, but I think we're in a strong position."

Such an extra safeguard would give additional comfort to "Arkansas Works" proponents. In terms of the political optics, the Medicaid expansion was already re-authorized via a weird trick; this additional step doesn't make it any weirder. It just seals the deal that's already been made. If anything, it would make the whole operation more overboard in terms of legislative intent.

Here's how the safeguard idea would work. This gets into some curious existential questions about legislation, but this is what legal experts have told me: Even though the governor has already vetoed the amendment ending "Arkansas Works," lawmakers could still pass a piece of legislation that in practice supersedes the amendment itself. Needing only a simple majority, the legislature could essentially overturn any of the non-fiscal, substantive language in the appropriation, including hypothetical substantive language that has already been vetoed.

Keep in mind, after the revisions, the dummy amendment doesn't ban funding of the program, it simply gives an end date for the Medicaid expansion at the end of this year. The legislature could (again, this is without having to fool with supermajority requirements) pass a law with a new end date for "Arkansas Works" — say, five years from now, when the waiver would be set to expire. This new law, because it came after the appropriation, would supersede the amendment — even if the amendment was revived via a lawsuit that overturned the governor's line-item veto. Got all that?

In other words, a law that says the program sunsets on Dec. 31, 2016 is a dead letter if a new law passes and gives a new, later sunset date.

The new legislation would likely be larded up with all manner of non-codified language documenting legislative intent, just to make things crystal clear.

If the legislature passed such a law, according to the legal experts I've spoken with, the Medicaid expansion would continue even if opponents won a longshot lawsuit overturning the governor's veto. The knot, as the governor put it, would be double-tied.

Support for special health care reporting made possible by the Arkansas Public Policy Panel.